Attached files

file filename
S-1/A - FORM S-1/A2 REGISTRATION STATEMENT - Dwarf Technology Holdings, Inc.s1a2_s1z.htm
EX-23.1 - EXHIBIT 23.1 AUDITOR'S CONSENT - Dwarf Technology Holdings, Inc.s1a2_ex23z1.htm



Exhibit 99.1


10182


Suggestions on Further Improvement of the Work System of Zhejiang Small and Medium Size Enterprises

Volume 10 (No. 182)


26099%84 %

81%82%93 %


Zhejiang is an important province in China in regards of small and medium size enterprises. At present, there are as many as 2.6 million small and medium size enterprises in Zhejiang, accounting for 99% of its total enterprises, 84% of its total industrial output, 81% of industrial tax, 82% of its foreign trade and export and 93% of employees in industrial enterprises. So that Zhejiang is one of the most developed provinces in China in regards of small and medium size enterprises. In recent years, with the changes in environment and the stage of development for the SMEs, authorities in charge of SMEs have faced higher demands for providing service and guidance. It is of great significance for promoting the development of provincial economy, the industrialization, modernization and social stability to strengthen the construction of SME work system, to improve the existing operating methods and mechanisms and to improve the structure of government bodies so as to form a systematic joint force for promoting the good and fast development of SMEs.



197630

2000

2000







I.

Current Situation of Work System Construction of Zhejiang Small and Medium Size Enterprises


Since the establishment of township enterprise management institutions in our province in 1976, and with the development of township enterprises and more than 30 years of team development, Zhejiang has formed a complete administrative system from provincial to township for township enterprises. Before the year of 2000, there were three levels of administrative service divisions, the provincial, municipal and township, and most of these divisions were government departments or institutes directly subordinate to government. The township level divisions were Township Enterprise Management Office (abbr. TEMO). The institutional reforms in 2000 led to office sharing and sub-divisions of SME operating mechanism. After several times of institutional reforms, significant changes have occurred to SME (township enterprises) functional organizations, and their functions were clarified.


便11

655%591

2830%95%

1-2


A.

Organization structuring. According to the survey, some cities and counties have municipal bureaus for small and medium size enterprises, others don’t, and most of the bureaus share offices with other bureaus, so that the main body exercising the function is not unified. There are problems such as overlapping functions, unclear responsibilities and poor management and service, leading to inconvenience for providing guidance for SMEs in practical work. The survey also shows that among the 11 surveyed prefectures or cities, 6 have bureaus for small and medium size enterprises, accounting for 55%, and the other 5 only established SME division in economy and trade section; among all 91 counties (cities and districts), 28 have SME bureaus, accounting for 30%; most of the others have SME administrative offices, which accounts for 95%; there are no sole duty institutions for SMEs in most towns in our province, and commonly, most towns appoint one to two officers to do it as a part-time job.




2





2010

iResearch: 2010 Annual Data Release of Search Engines in China


2010109.8亿 


Market size: Chinese market for search engines reached 10.98 billion Yuan in 2010, with a fast expanding


iResearch2009-2010

2010109.8亿16.5亿200969.6亿

57.7%


According to the statistics in the upcoming 2009-2010 Development Report of Search Engine Industry in China by iResearch, the search engine market size in China calculated in line with the statistics by network operators has reached 10.98 billion Yuan (1.65 billion US dollars), which amounts to 57.7% yearly growth compared with the 6.96 billion Yuan in 2009.


2010

广广广

广CPC

ARPU


After analyzing the above statistics, iResearch thinks that the search engine market in China is rapidly expanding because of the following reasons: firstly, the economy was recovering in 2010 so that advertisers, especially the ones from SMEs increased their marketing budget; secondly, in the period of economic crisis, the brand advertisers tried tentative advertisement and were caught in inertial consumption; thirdly, the strategic adjustment of Google has shortened the adjustment phase of Baidu, which increased its click rate, tags for selection and CPC, and further increased its ARPU.


2011广2010广

2011

55%


iResearch predicts that in 2011 in the search engine market in China, Baidu will have a stable increase of advertisement income because of its successful system switch in 2010; network operators such as Sogou and Soso will also have an increase in marketing revenue because of traffic accumulation. iResearch predicts that in 2011 the search engine market in China will have an increase of about 55%.



3





[s1a2_ex99z1001.jpg]


[s1a2_ex99z1002.jpg]



4






2010广


Data of the industry: the proportion of search engine market size in the online advertising size is reduced in 2010


广201030.8%广


According to statistics of iResearch, the proportion of search engine market size in the online advertising size was 30.8% in 2010, and this proportion was stabilized in the context of great increase in brand advertisement attracted by hot events.


2011广2010

广20112010广广

广201133.2%


iResearch predicts that in 2011, the proportion of search engine in China in online advertising market will increase because of the following reasons: firstly, in 2011,  the growth state of brand advertisements that had been affected by hot events in 2010 will return to their marketing scale; secondly, with the general acceptance of advertisers for the newly promoting system in 2010, the concepts of accurate marketing and effect marketing were gradually popularized, so that the search engine will gain recognition from more advertisers. iResearch predicts that in 2011, the proportion will reach to 33.2%.



5






[s1a2_ex99z1003.jpg]


[s1a2_ex99z1004.jpg]



6






20103.8亿82.3%


User size: users of search engine in China reached 380 million, accounting for 82.3% of user coverage


CNNICiUserTracker

2010

3.8亿20093.2亿18.8%20114.5亿2014

6亿


According to the statistics of CNNIC on the number of Internet users in China and the newest statistics of iUserTracker (continuous user action research system of net citizens), iResearch has found that the user scale of search engine in China (definition: the number of users who have requested for one search in 6 months, excluding the number of site navigation user) in 2010 would be 380 million, with a 18.8% annual growth compared with the 320 million in 2009. The predicted number of 2011 will reach 450 million, and about 600 million for the year of 2014.


201082.3%2009

使使

15%


According to the analytic statistics of iResearch, the user number of search engine in China accounts for 82.3% of the total number of net citizens in China, with a slight increase compared with that of 2009. In coming years, the coverage rate of search engine users will continue to have a slight increase, because on one hand, vertical search engines such as etao.com bring more vertical search engine users into the figure, thus increasing the number of search engine users; on the other hand, the number of new Internet users is large, but the number of those who have skills such as input methods and can produce search requests is relatively small, so that the proportion of those who use search engines will decrease, and the speed increase will be slowed down compared t with early years. The analytic statistics of iResearch shows that the further percolation of the Internet and the search engines will lead to steadiness and slight increase of search engine coverage rate. But compared with the total population of China, the number of search engine users accounts for less than 15%, so that there are still upside potential for the search engine user scale.



7






[s1a2_ex99z1005.jpg]


[s1a2_ex99z1006.jpg]



8






线


Current situation of competition: further centralization of search market, and second-line network operators exploring the market


201097.6%

线


Market centralization increased in search engine market in China in 2010: market share of Baidu and Google accounts for more than 97.6%, basically dominating the search engine market in China. And after the Google Incident, a new market gap emerged, so that second-line network operators actively explored search industry for market expansion.


2010退google.cngoogle.com.hk

26.0%20096.2

71.6%

线


In 2010, Google retreated from the Chinese market, and google.cn stopped operation. The domain name of it has jumped to google.com.hk, which would provide Chinese search service. Affected by this incident, its market share dropped to 26.0%, 6.2% lower than that of 2009, and the market gap was thus created. At the meantime, by relying on existing resources, product advantage and further innovation, Baidu accounted for 71.6% of market share, continuing its leading position in the market. As for other operators, Souhu officially announced that Sogou, a unit of its brand, was to establish a joint venture with Alibaba for independent operation; Tencent announced that Soso Business Division was established for search operations, and that they would innovate and optimize the search engine for resource reserve. The rapid development of second-line network operators intensified market competition, and the development trend is worth noticing.




9





[s1a2_ex99z1007.jpg]


[s1a2_ex99z1008.jpg]



10







Development tendency: search engine market in China will have another round of increase


2010使

IM//

使


After analyzing the development tendency of the search engine market in China, iResearch thinks that this industry will have a sustainable development because of the following two reasons: first, further popularization of Internet in China and growing awareness of effect marketing; second, rapid development of e-commerce brings about rigid demand of search marketing. In the aspect of market competition, the Google Incident of 2010 resulted in the development of operators such as Soso, Sogou, Etao and Youdao, making it possible for diversified competition in future market. In next three years, contention and competition on traffic will be fiercer. In the aspect of product, firstly, the combination of desktop software (IM/dictionary/browser) and search engine will be more common, and even be the breakthrough point for new operators to enter into the market; secondly, it is sure that vertical operators of good credit will enter the search market through cooperation or independent research and development; thirdly, rapid development of micro blogs makes it possible for the development of real time search.




11